Senate GOP says tax credits take precedence over minimum pay boost

Published 11:21 pm, Monday, May 28, 2012

The action also counters the passage of a bill in the Democrat-dominated Assembly to increase the minimum wage.

"It builds on our accomplishments in the last two years working with Gov. Cuomo for an on-time budget," Senate Majority Leader Dean Skelos, R-Long Island, told the Times Union. "We have to continue to do this. As we move into our summer recess, it's critically important that we cut taxes, especially on small businesses, as soon as possible."

The package, parts of which are already included in the one-house budget resolution the Senate advanced in March, is broad. It repeals a tax on manufacturers and offers credits for new hires — $5,000 for any worker, $8,000 for a hire who was collecting jobless benefits, and up to $10,000 for a returning military veteran.

Another proposal would restore a tax credit for state-based craft brewers, which was ended by a court ruling. The change is costing Troy-based Brown's Brewing Co. roughly $11,000 a year, said Gregg Stacy, its vice president.

More Information

Poll results

Here is how New York voters responded to a May 14 Siena Research Institute poll:

78% of New York voters support a minimum wage hike, including

58% of self-identified Republicans, and that

65% of voters support a package of tax cuts and credits, including

64% of self-identified Democrats.

TIMES UNION

Business groups around the state praised the proposals. Gov. Andrew Cuomo last week parried a question about it. Assembly Speaker Sheldon Silver has said the state can't afford to pass the tax credits now.

The package would cost the state up to $130 million this year and $1 billion within four years, Skelos said. He was not specific about how it would be paid for, but said, "We're seeing increased revenues from VLTs and in other areas; we know in a $134 billion budget we can accomplish this without cutting other programs."

Silver said the measure couldn't be considered outside of the budget, essentially blocking it before the Legislature adjourns in June.

"I do not think we can afford it this year," the Manhattan Democrat said.

The tax package is seen at the Capitol as a counterpoint to Silver's plan to raise the minimum wage $1.25 per hour, to $8.50, a boost that passed the Assembly earlier this month.

Support for the minimum wage increase is already being used as an election issue by Democratic candidates in both the Assembly and Senate. All 212 of the state's legislative seats, plus a new 63rd seat in the Senate, are up for election in November.

Skelos could use passage of tax credits as a way to boost Republican prospects in the Legislature.

A May 14 poll by the Siena Research Institute found 78 percent of state voters support a minimum wage hike, including 58 percent of self-identified Republicans, and that 65 percent of voters support a package of tax cuts and credits, including 64 percent of self-identified Democrats.

Skelos said the fastest-growing segment of small-business owners are Latinos, an ethnic constituency that Republicans in New York and beyond are trying to split from Democrats.

"If the speaker is serious about creating jobs and wanting to help, especially small businesses creating jobs, he'll support us," Skelos said. "The minimum wage, as I've said all along, is a job-killer right now. When the economy is good and the private sector is booming, we can consider an increase in the minimum wage. ... It's the wrong time now. Our (legislation) is about creating jobs."

Silver has argued a minimum wage hike will inject money into local economies because earners on the lowest end of the economic ladder spend the money they have near their own homes. It would be a sort of mini-stimulus, the speaker said. It would help small businesses create more jobs. While labor groups support the proposal, business lobbyists oppose it.

Can the two proposals be offset?

Silver and Skelos insist they are not and should not be linked.

But others in the Capitol assume both proposals will be considered in tandem, as most significant legislation is. Cuomo himself even called them "inverse."